Test Bank For Accounting for Governmental & Nonprofit Entities Jacqueline Reck 18 Edition

Test Bank For Accounting for Governmental & Nonprofit Entities Jacqueline Reck 18 Edition

Accounting for Governmental and Nonprofit Entities, 18e (Reck)

Chapter 2   Principles of Accounting and Financial Reporting for State and Local Governments

1) According to the guidance of GASB Concepts Statement 3, financial information can be communicated by recognition in the financial statements, disclosure in the notes to the financial statements, presentation as required supplementary information, or presentation as supplementary information.

2) According to GASB Concepts Statement 1 a primary objective of financial reports is to provide information useful in determining the accountability of the government.

3) Activities a local government can engage in are classified as governmental, business-type, or fiduciary.

4) Governmental funds are identical to governmental activities, proprietary funds are identical to business-type activities, and fiduciary funds are identical to fiduciary activities of a government.

5) Only those governmental and proprietary funds that meet the GASB size criteria for major funds are reported in separate columns of the governmental and proprietary fund financial statements.

6) Economic resources are cash or items expected to be converted into cash during the current period, or soon enough thereafter to pay current period liabilities.

7) Governmental funds account for assets but not the liabilities.

8) The types of funds that may be used in governmental accounting are classified into the three categories of governmental, proprietary, and fiduciary.

9) The governmental funds category includes the General Fund, special revenue funds, debt service funds, capital projects funds, and internal service funds.

10) Governments can, in part, demonstrate operational accountability by reporting proprietary and fiduciary fund financial information, as well as all government-wide financial information, using an economic resources measurement focus and the accrual basis of accounting.

11) All capital assets acquired by or used by a fund should be reported in the fund balance sheet or statement of net position.

12) Because budgetary accounts are used by governments, government financial statements can never be said to be in accord with generally accepted accounting principles.

13) The maximum sets of fund financial statements a government would present are three.

14) When revenues are legally restricted by external resource providers or committed by enabling legislation for particular operating purposes, a private purpose trust fund is created.

15) A debt service fund is used to account for financial resources segregated for the purpose of making principal and interest payments on general long-term debt.

16) A deferred inflow of resources is defined as “an acquisition of net assets by the government that is applicable to a future reporting period.”

17) Expenditures are never recorded in governmental funds.

18) Deferred outflow of resources is a type of asset that is unique to government.

19) Revenues is an example of what the GASB terms an inflow of resources.

20) An expenditure is an example of what the GASB terms an outflow of resources.